The Kazakh government is preparing to increase the tax burden for cryptocurrency miners and intends to tie the new rate to the value of the mined cryptocurrency. Nur-Sultan authorities believe that such approach will have a positive impact on the state budget.
Miners in Kazakhstan will pay tax on the value of mined cryptocurrency
Kazakhstan is taking steps to raise tax for organizations mining cryptocurrency in the country. According to the Minister of National Economy Alibek Kuantyrov, there are plans to calculate the tax based on the market value of the mined cryptocurrency.
The official noted that the introduction of such a scheme will increase budget revenues, reports Tengrinews.kz. Currently, miners working in Kazakhstan pay a surcharge for the electricity consumed.
Last summer, mining companies were forced to pay more than other consumers. Tariffs were raised to reflect a charge of 1 Kazakhstani tenge (about $0.0022) per kilowatt hour of electricity consumed by energy-intensive industry. At a press conference this week, Kuantyrov said:
We are considering increasing the tax burden for miners. We are also currently considering tying the tax rate for miners to the value of the cryptocurrency. If cryptocurrency grows, it will be good for the budget.
At a government meeting in February, President Kassym-Jomart Tokayev instructed officials to “multiply” the tax levy on cryptocurrency mining. The head of state also instructed the country’s financial control to identify all mining enterprises in the country and check their tax and customs documents.
Thanks to limited electricity tariffs, Kazakhstan became a magnet for bitcoin miners last year when China launched a nationwide crackdown on the industry in May. The influx of miners was blamed for the country’s growing electricity shortage, and the Kazakh government began to tightly control the sector.
Even authorized miners suffered from power outages during the winter months. Power shortages have already forced some companies to leave the country and move to other mining locations, such as the United States. Last month, more than 100 minting farms were shut down across Kazakhstan.
A recent report showed that authorities are cracking down on cryptocurrency miners using tax loopholes. Five mining companies were accused of taking advantage of tax breaks given to IT businesses and other innovation companies.
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